Enbridge awards Aecon JV $282M Manitoba pipeline contract

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Dive Brief:

Canada-based construction and infrastructure firm Aecon Group announced Wednesday that Enbridge Pipelines has awarded the company and its 50/50 joint venture partner, Robert B. Somerville Co. Ltd, a $282 million contract to build two sections of pipeline in Manitoba, Canada. The companies will perform the work as SA Energy Group.

SA Energy will build a 57.3-mile pipeline near Brandon, Manitoba, and a 60-mile pipeline near Morden, Manitoba, the latter of which will extend to the U.S.-Canada border. The two pipeline segments are part of the second phase of the largest project in Enbridge history, the Line 3 Replacement. The Canada portion of the project is valued at CA$5.3 billion and the U.S. portion at $2.9 billion. It will see the replacement of 1,031 miles of Line 3 segments — and associated facilities — from Hardisty, Alberta, to Superior, Wisconsin. The project is intended to increase capacity for Canada's crude oil production, as well as meet refinery demand in both Canada and the U.S.

SA Energy has already completed 162.2 miles of pipeline for two, first-phase Line 3 Replacement spreads in Saskatchewan and expects to start construction on the second phase in August, with substantial completion slated for the end of this year. John M. Beck, president and CEO of Aecon, said the Line 3 Replacement contract, combined with the company's other recent awards, will result in record company backlog levels for the second quarter.

Dive Insight:

Future cross-border energy infrastructure initiatives will be able to skip some of the time-eating red tape associated with such projects if one U.S. senator gets his way.

In June, John Hoeven, a Republican senator from North Dakota introduced the North American Energy Infrastructure Act, which would eliminate the requirement that electric, oil and gas infrastructure projects built between the U.S. and Canada or Mexico secure a presidential permit. Instead, the suitable federal agencies would take over the permitting process for these cross-border projects. Energy companies would still have to undergo environmental reviews, and contractors would have to abide by local regulations. Ultimately, the act would attempt to increase transparency and help standardize construction, operation and maintenance of energy projects that cross U.S. borders.

Within the U.S., domestic energy contractors are booking billions in business. For example, Industrial Info Resources reported earlier this month that Houston-based Troy Construction has almost $1.5 billion of natural gas pipeline projects underway. In June, Bechtel announced an award for an LNG facility in Port Arthur, Texas, worth up to $9 billion. Sempra Energy of San Diego has hired the company to act as the engineering, procurement, construction and commissioning contractor for two natural gas liquefaction trains, feed gas pre-treatment facilities, natural gas liquids and refrigerant storage and up to three gas tanks. Cheniere Energy also hired Bechtel to build the company's $11 billion Train 3 expansion in Corpus Christi, Texas.